Analysis
Private Equity Confidence Survey - Winter 2019/2020
Veteran resilience
The Private Equity Confidence Survey has been tracking the changing sentiments of the Central European investment community every six months since 2003. Deloitte Central Europe proudly presents the latest report which marks the 34th edition of the programme.
Central European Private Equity Index: Key findings
Economic expectations and thus confidence are deteriorating, with nearly half of respondents (46%) expecting the economy to worsen over the coming months. Though this is up markedly from last survey’s 17%, it remains the case that most CE economies are growing 2-3x faster than most Western European ones: Poland and Romania are expected to grow at 3.5% and 3.1% respectively for 2020, against 1% for the eurozone. Also significant, no respondents expected the economic backdrop to improve in the coming months.
It is a sellers’ market, with a quarter of respondents (25%) expecting to focus on this, up from under a fifth (19%) last survey and the largest proportion since our spring 2015 index. The results break an 18-month spell of consistent findings which saw the majority expecting to focus on buying, a quarter of deal-doers planning to buy and sell equally and a fifth expecting to focus on divestments.
Vendor price expectations may be at an inflection point, with 80% of our respondents feeling pricing had remained the same (65%) or decreased (15%) over the last six months. These may fall further, with an unprecedented 48% of our respondents expecting pricing to come down further over this year, more than double last survey. Only 15% expect pricing to increase further.
Veteran resilience
Confidence among professionals in Central European (CE) private equity (PE) houses has been declining gradually for two years to reach a seven-year low. As ever, confidence and economic expectations are linked, and this survey revealed nearly half of respondents (46%) are expecting conditions to worsen, up markedly from last survey’s 17%.
- says Mark Jung, Deloitte Partner and CE Private Equity Leader.
Additionally, times of potential uncertainty can be fertile grounds for the well prepared to do deals, particularly where there may be sentiment that can help support an exit thesis for those entrepreneurs who lack a clear succession alternative.
- adds Mark Jung.
Download previous editions
- Harvest mode Central Europe Private Equity Confidence Survey - July 2019 (PDF, 1 MB)
- Caution returns
Central Europe Private Equity Confidence Survey - December 2018 (PDF, 1 MB) - Maintaining momentum
Central Europe Private Equity Confidence Survey - May 2018 (PDF, 1 MB)
- Healthy appetite
Central Europe Private Equity Confidence Survey - November 2017 (PDF, 1,16 MB)
- Great expectations
Central Europe Private Equity Confidence Survey - May 2017 (PDF, 1,26 MB)
- Resilience amidst uncertainty
Central Europe Private Equity Confidence Survey - October 2016 (PDF, 1.2 MB)
